ANGALURU: As early as in June 2014, RTI activist S Dheenadhayalan had written to Prime Minister Narendra Modi, warning that accounting procedures in public sector banks (PSB) encouraging discretionary practices will facilitate huge misappropriations from borrowers. Now post-PNB scam, Dheendhayalan without displaying `I told-you-so’ look, has renewed his campaign demanding the creation of an authority on lines of TRAI (Telecom Regulatory Authority of India) in order to protect interests of customers and borrowers.
Dheendhayalan says he wrote the letter to PM based on his findings of four years of collecting information from RBI (Reserve Bank of India), CVC (Central Vigilance Commission) and ICAI (Institute of Chartered Accountants of India).“Information obtained under RTI revealed anomalies in banking system and the fault lies with all public institutions, RBI (supervisory), CVC (vigilance) and ICAI (audit),’’ he informed Express. This RTI activist says that SARFAESI act 2002 (allowing banks to enforce one-time settlement with defaulting borrowers in a civil court barred environment) was blatantly abused by banking institutions.
Dheendhayalan says PNB scam has proved that banking institutions had a multiple accounting system and were lending outside core banking solution (CBS). Interestingly, the short-term loans to corporates are supported only by the borrowers financial flow chart. Due to PNB scam, banks had begun demanding more security from small investors and are revising interest rates, he added